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The president of the European Commission, Ursula von der Leyen, has called for a new era of EU integration to sustain growth in the face of a global economy “fracturing along new lines” as Donald Trump enters the White House.
Speaking at the World Economic Forum in Davos while the US president prepares to press ahead with his protectionist agenda, the head of the EU executive said the bloc could no longer rely on the approach that has sustained it this century.
“In the last 25 years, Europe has relied on the rising tide of global trade to drive its growth. It has relied on cheap energy from Russia, and Europe has too often outsourced its security. But those days are gone,” von der Leyen told the summit in the Swiss resort.
She did not mention Trump by name, but her prescription for closer collaboration appeared to be in part a response to the new administration’s nationalistic approach.
She said today’s world was “still nearly as connected as ever, but it has also started fracturing along new lines”, adding: “The cooperative world order we imagined 25 years ago has not turned into reality. Instead we have entered a new era of harsh geostrategic competition … We will need to work together to avoid a global race to the bottom.”
Von der Leyen said the commission would shortly publish new proposals in three areas – responding to the report it commissioned from the former European Central Bank president Mario Draghi last year about how to increase productivity and growth.
She called for deeper integration of capital markets, the dismantling of barriers in the single market – so that innovative companies can operate under a single set of rules across the 27-member bloc – and a new “energy union” to permanently end the reliance on Russian gas.
On capital markets, von der Leyen complained that €300bn (£254bn) of EU families’ savings are invested overseas every year.
“We do not lack capital. We lack an efficient capital market that turns savings into investments, particularly for early-stage technologies that have gamechanging potential,” she said.
To tackle this problem, she called for a “savings and investments union”, which would create new investment products for consumers.
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In what appeared to be a sideswipe at Trump’s approach, von der Leyen said: “With Europe, what you see is what you get. We play by the rules. Our deals have no strings attached.”
She also insisted that the bloc would “stay the course” as a signatory to the Paris climate agreement, which she called, “the best hope of all humanity”. Trump has already signed an executive order signalling US withdrawal from the treaty.
Von der Leyen insisted the EU was ready for discussions with new US administration, however – promising to “engage early, discuss common interests, and be ready to negotiate”.
She stressed the deep economic links between the US and the EU, including the fact that European companies in the US employ 3.5 million Americans, and the US provides more than half of the bloc’s gas supplies.
